• Independent review doubtful • Citizen contractors overlooked

BG reporter

Jwaneng Mine expansion project has sparked controversy as some citizen-owned companies accuse Debswana diamond mine of favouritism in the award of lucrative tenders for the ongoing Cut 8 project.
Cut 8 is a multi-million Pula Jwaneng Mine project aimed at extending the life of the world’s richest mine by another seven years (2017 - 2024), exposing additional 75 million tonnes of diamond bearing ore. Costing P3.5 billion, it is Debswana’s single biggest project and involves the removal of about 700 million tonnes of waste material.
In the Cut 8 project the current open pit mine is being expanded to access kimberlite ore at a greater depth. This expansion includes relocating and rebuilding parts of existing surface infrastructure that are impacted by the pit expansion.
Sources close to Cut 8 tendering procedures revealed that a significant number of citizen-owned companies registered with Debswana supply chain have been overlooked in favour of foreign companies despite their level of competence and experience. There is disquiet that Fluor Corporation, a company that won a US$450 million engineering, procurement and construction management (EPCM) tender, has sub contracted foreign companies, mostly from South Africa. Fluor is a NYSE-listed Fortune 500 global contractor that delivers EPCM and project management to governments and clients in different industries across the globe. Sources say Debswana contracted Fluor but took a backseat as the global contractor sidelined citizen-owned contractors.
“(Cut 8) work was given to outsiders,” complained one contractor who did not want to be identified. “Stimulating growth of our economy requires involvement of citizen-owned companies,” he said. “Now they are stimulating the South African, Indian and Chinese economies.” His colleague, a mining engineer, adds frantically:
“We have all the knowledge and the skills. We are just being frustrated,” he notes.
The duo complained that by leaving the fort to Fluor, Debswana and government are actually abdicating their responsibility. “Review mechanism at Debswana is non-existent,” says a source. “I doubt if there was a detailed and independent study carried out before embarking on Cut 8,” he points out, adding further that considering the amount of money spent on Cut 8, “there is need for independent eyes.”
Debswana is a 50\50 joint venture between government of Botswana and the world largest diamond miner - De Beers. De Beers is owned by the Oppenheimer family (40%), Anglo American (45%) and Botswana government (15%). It is this symbiotic relationship that has in the past, allowed Anglo American to carry out Debswana work. The source makes a case of historical bias by Debswana that favoured foreign companies. In 2000, he says, Debswana embarked on a P1.5 billion Orapa Mine expansion project dubbed Project 2000.
According to him, only P30 million went to citizen owned companies. “The attitude here is that we do not celebrate our professionals,” he cries and continues:
“Yes, there has been a credit crunch, but those foreign companies will make their profits and take it back to their countries. We can’t stimulate the economy that way.”
He paints a gloomy picture of Debswana board, saying it is made up of citizens who do not have sufficient knowledge relating to the business of mining engineering. Information unearthed by Botswana Guardian indicates that among the board members it is only Jacob Thamage who has qualifications in mining engineering.
Other citizen board members include: Linah Mohohlo, governor of Bank of Botswana, Eric Molale, Permanent Secretary to the President, Solomon Sekwakwa, Permanent Secretary in the Ministry of Finance, Dr. Atalia Molokomme (Attorney General) and Sheila Khama.
Reached for comment, Debswana disparaged disgruntled contractors’ concerns and said it has a competent Project Management group that performs world-class geotech work without De Beers input. “Neither De Beers or Anglo American are engaged to execute projects for Debswana,” said Debswana spokesperson, Esther Kanaimba-Senai.
Kanaimba-Senai named 16 Debswana citizen-owned companies carrying out Cut 8 related work, saying in 2009 alone her company spent about 80% of its procurement allocation on local suppliers. She, however, declined to reveal the total amount spent on Batswana local companies, arguing that the information remains privileged.
Debswana said companies awarded tenders in Cut 8 include; Maboge Construction; Preston Investments; Geoflux; BWR Quantity Surveyors; NTR Technology Holdings; EHES; Pula Groundwater Developers; NMA; Frontier Investment; Matcoy Supply and Services; Bokamoso Engineering; Antigonon; Savanna Tanks; Afrogeodata and City Developments.  
Asked whether it is vital for board members to have mining-related qualification, Kanaimba-Senai said the director’s role is not to carry out daily operational activities, but to offer strategic guidance.
For his part, Kgomotso Abi, Director of Mines in the Ministry of Minerals, Energy and Water Resources said government took an independent review of Jwaneng Mine Cut 8 before the project was embarked on. He said the process entailed a shareholder’s Assurance Review of the project. “The project was reviewed by the Debswana Technical Committee (a sub committee of the board). Permanent Secretary in the Ministry of Minerals and Director in the Department of Mines represented government.
“The major conclusions of the review were that the project has a robust business case with a high net present value and short payback period,” said Abi, adding that there were no fatal flaws identified for the project and was recommended for implementation. However, both Abi and Kanaimba-Senai could not explain the level of independence of the Shareholder’s Assurance Review, which comprises of Debswana and De Beers team.
Fluor had not responded to questions by press time.